When calculating free cash flow, it is important to include interest and principal payments.
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Q7: Bankruptcy and agency costs both act as
Q8: Direct-bankruptcy costs are considered transactions costs and
Q9: Issuing debt is usually less expensive than
Q10: If a firm has debt and pays
Q11: A financial restructuring can change the value
Q13: More debt in a firm's capital structure
Q14: Under the M&M assumptions with taxes, the
Q15: Indirect bankruptcy costs will often increase when
Q16: Indirect bankruptcy costs include changes in customer
Q17: With no debt, the WACC is the
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